What are you doing, Electronic Arts (NASDAQ:ERTS)? This is getting embarrassing.

The leading video game maker is extending its buyout offer to Take-Two Interactive (NASDAQ:TTWO) this morning, after it expired yet again last night with less interest than before.

Persistence and loyalty can be honorable traits, but this isn't a Labrador retriever we're talking about here. This is a company. Why can't EA take a hint?

You're driving the wrong way, EA
Just 6.4 million shares -- 8% of Take-Two's outstanding shares -- were tendered to EA when its first offer expired back in April. It extended the offer, only to see the repeat performance expire with a total of 6.2 million shares tendered last month. Its latest try ended yesterday, with Take-Two investors offering just 6.1 million shares.

In other words, not only is EA not winning over any new converts, but those already in the mix are getting cold feet and gradually withdrawing their tenders.

Maybe they're responding to the way EA brashly slashed its offer from $26 to $25.74 a share, as some silly scare tactic to punish Take-Two for pushing through a costly severance package. Or maybe it's the way EA ignores reality.

"Our offer price remains unchanged at $25.74 per share, which is a substantial premium to where Take-Two's stock was trading prior to our offer," Owen Mahoney, senior vice president of EA Corporate Development, notes in this morning's press release.

Nice one, Mahoney. Let me know when you get your head out of that vacuum.

A lot has happened since EA's original buyout offer.

  • Take-Two's Grand Theft Auto IV became the fastest-selling game of all time.
  • Take-Two has blown past Wall Street's expectations and ramped up its guidance.
  • More than just a one-hit wonder, Pirates of the Caribbean mastermind Gore Verbinski has signed on to give Take-Two's BioShock a theatrical film treatment.
  • GTA4's success bodes well for deals for digitally delivered episodes through Microsoft (NASDAQ:MSFT) and MP3 sales through Amazon.com (NASDAQ:AMZN).

On the flip side of that coin, a lot has happened to perhaps make EA more desperate.

  • How many of the 10 best-selling video game titles did EA score last month? None.
  • Over the past three months, analysts have raised their current-year profit targets for Take-Two, Activision (NASDAQ:ATVI), and Konami (NYSE:KNM). EA joins THQ (NASDAQ:THQI) as the rare companies in this industry for which Wall Street is lowering its guesstimates.
  • Activision's ascent is coupled with its acquisition of World of Warcraft wunderkind Blizzard Entertainment. That move affects EA's market-leadership position.

This can't end well
What is EA doing here, exactly? Is it just waiting until Take-Two takes legal action to recoup the costs of swatting away an insulting offer? EA needs to either dust itself off, walk away, and forget it ever wanted Take-Two, or come back with a materially improved offer.

This isn't some John Hughes flick, where the protagonist is losing ground but will still nab a kiss from the love interest whose popularity is on the rise. This is a sicker tale of obsession, stalking, and delusion.

Hanging around and hoping Take-Two somehow stumbles into its trap is too Boxing Helena for Mr. Market's taste. When will EA take a closer look in the mirror to realize that it's the one running low on arms and legs?